Sameer Dossani: Let's talk about the recently passed Iraqi oil law. It's well known that the law was drafted in the U.S. and then consulted on by very few Iraqis all loyal to Prime Minister Noori al-Maliki, then finally pushed through the Iraqi parliament. This law paves the way for regionalization and privatization of Iraqi oil. What's the U.S. economic agenda in Iraq and will it be able to carry that agenda out, given the disastrous nature of the occupation so far?

Noam Chomsky: It's not very clear. What you said is correct. The law was not even seen by the Iraqi Parliament until it was finished, so it's an inside job. Exactly what this entails is still kind of open. It allows for Production Sharing Agreements (PSA's) which have traditionally been a way of gouging the producer and ensuring that foreign corporations have control and make huge profits. It's quite different from other contractual arrangements in the region--it's what they used to have but they've since nationalized their oil production and countries set terms more in their own interest with the corporations that are moving in. This law is vague on that so it leaves it open.

As far as the U.S. economic interests I think we have to make a distinction. The primary interest, and that's true throughout the Middle East, even in Saudi Arabia, the major energy producer, has always been control, not access, and not profit. Profit is a secondary interest and access is a tertiary interest.

So in the years when the U.S. was not using Middle East oil at all, [the U.S.] was the largest producer and the largest exporter, it still had the same policies. It wanted to control the sources of oil and the reasons are understood. In the mid-1940s, the State Department made it clear that the oil resources of the region, primarily then Saudi Arabia, were a stupendous source of strategic power which made the Middle East the most strategically important area of the world. They also added that it's one of the greatest material prizes in world history. But the basic point is that it's a source of strategic power, meaning that if you control the energy resources, then you can control the world, because the world needs the energy resources.

This was made explicit by George Kennan when he was one of the Middle East planners [in the U.S. State Department]. [He said that] control over Middle East oil will give us veto power over our rivals. He was specifically talking about Japan, in case Japan industrialized, it was devastated by the war still, we'll have veto power as long we control the oil. And that's been understood through the years. So in the early stages of the Iraq war [former U.S. National Security Advisor] Zbigniew Brzezinski, who's one of the more astute of the planners--he was not terribly enthusiastic about the war--said that if the U.S. wins the war, which means that it succeeds in imposing a client regime in Iraq, then the U.S. will have critical leverage over its industrial rivals in Europe and Asia because it will have its hand on the spigot.

And that is also understood very well at the highest level of the administration. So a few months ago, Dick Cheney said that control over [oil] pipelines can be "tools for intimidation and [blackmail]". He was talking about control over pipelines in the hands of others, so if our enemies have it, it's a tool of intimidation and coercion. But of course the same is true if it is in our hands. We're not supposed to think that because we're supposed to be noble, but the rest of the world certainly understands it. Yes, it's a tool of intimidation and coercion, whether it's the direction of pipelines or whether its control over the production or over the regimes in question, and control can take many forms.

So that's the primary concern--control. A secondary concern is undoubtedly profit for U.S.-based corporations and British based corporations and several others of course. And yes [in the case of the Iraqi oil law] that's a possibility. The Production Sharing Agreements and the other arrangements for long-term contracts at ridiculous rates, those are expected to be sources of immense profit as they have been in the past, so for example a couple of weeks ago Exxon-Mobil posted its profits for 2006 which are the highest for any corporation in U.S. history. That broke the record of the preceding year, which also happened to be Exxon-Mobil and the other energy corporations are doing just great--they have money pouring out of their ears. And the same with the corporations that link to them, like Haliburton, Bechtel and so on.

The material prize of oil production is not just from energy. It's also from many other things. Take Saudi Arabia or the [United Arab] Emirates. They have huge construction projects paid for by petro-dollars which recycle back to Bechtel and other major construction companies. A lot of it goes right back to U.S. military industry. So these are huge markets for U.S. military exports and the military industry in the United States is very closely linked to the high-tech economy generally. So it's a sort of a cycle--high prices for oil, the petro-dollars pour back to the U.S. for major construction projects for high-tech industry, for development, for purchasing treasury securities which helps bolster the economy--it's a major part of the economy and of course it's not just the United States. Britain, France and others are trying very hard to sell them the same things and sometimes succeeding. There was a big bribery scandal in Britain recently because of efforts to bribe Saudi officials into buying jet aircraft and so on. So the basic idea of the energy system is that it should be under the control of loyal clients of the United States, and they're allowed to enrich themselves, become super rich in fact, but the petro-dollars are basically to cycle back to the West, primarily the United States in various forms. So that's a secondary concern.

A tertiary concern is access. That's much less of a concern. One of the reasons is that the distribution systems are pretty much in the hands of big energy corporations anyway and once oil is on the high seas, it can go anywhere. So access is not considered a major problem. Political scientists, when they make fun of the idea that the U.S. invaded Iraq to gain its oil, they point out is that the U.S. can get Middle East oil in other ways so therefore that can't be the reason. That's true, but it's irrelevant because the true issues are and always have been control and secondarily profit and in fact U.S. intelligence projections for the coming years have emphasized that while the U.S. should control Middle East energy for the traditional reasons, it should rely primarily on more stable Atlantic basin resources, namely West Africa and the Western hemisphere. They're more secure, presumably and therefore we can use those, but we should control the Middle East oil because it is a stupendous source of strategic power.